Econ 201 Ch 3 Assessment

A. fixed, should not B. variable, should C. variable, should

Boeing is a producer of wide‑body aircraft. a. The manufacturing plant used to produce aircraft is a _____ cost for Boeing. The cost of the manufacturing plant _____ be included in the opportunity cost of producing an additional aircraft. b. The labor used to produce the aircraft is a ____ cost for Boeing. Labor costs _____ be included in the opportunity cost of producing an additional aircraft. c. The cost of the seats that are installed in each aircraft is a _____ cost for Boeing. The cost of the seats ______ be included in the opportunity cost of producing an additional aircraft.

A. decrease B. decrease C. $7

Christine is the general manager of a local automated car wash. The market she operates in is perfectly competitive. All of her competitors in the area charge $7 per car wash, which is also her marginal cost per wash. a. If Christine sets her price at $8, her profits will _____. b. If Christine sets her price to $5, her profits will _____. c. Christine's profit maximizing price is _____.

A. shift curve to the left B. move along the curve to the right

Consider the change in market conditions in each of the given scenarios. Use the graphs to illustrate whether the changing market conditions will result in a change in supply or quantity supplied. If the change in market conditions results in a change in supply, shift the supply curve appropriately, but leave the price line unchanged. If the change in market conditions results in a change in quantity supplied, adjust the price line appropriately, but leave the supply curve unchanged. a. An increase in the price of corn used in the production of ethanol reduces the amount of corn available for use as livestock feed. b. Speculators in world steel markets push the price of steel up, leading domestic steel companies to expand production.

shift supply curve to the right

During the 1990s, Dell Computer Company adopted a lean production process, a manufacturing process that reduces inefficiencies without reducing production. As a result, Dell became one of the largest PC manufacturers in the world. Consider what impact the adoption of lean production techniques likely had on Dell's supply curve for PCs. Show the impact in the graph below by shifting the supply curve or moving the point along the curve.

A. decrease, increase B. increase, decrease

Maria is an industrial engineer at a Toyota plant. Indicate how Maria should change her production plans in response to each change in market conditions. a. An engine supplier decreases the price it charges Toyota by 50%. As a result, Toyota's cost of production will decrease, and Toyota should increase its supply. b. Workers unionize and demand a 12% across-the-board raise. As a result, the cost of production will increase, and Toyota should decrease its supply.

.

Workers act as sellers of their time in the labor market in return for a wage. Consider the accompanying table, which details how many hours Ned and Lisa are willing to work at each wage rate. Move the points on each graph to plot the individual labor supply curves for both Ned and Lisa.

A. B. does

You have landed a job as an analyst working for a company that is creating a new environmentally friendly single-cup coffee maker. a. Using the accompanying graph, place the points on the graph to create the individual supply curve for your company. Price / Quantity supplied (thousands) $100 / 0 $150 / 500 $200 / 1,000 $250 / 1,500 $300 / 2,000 $350 / 2,500 $400 / 3,000 b. The supply curve for your company _____ follow the law of supply.

A. shift right B. shift right C. shift left

You have recently been hired by Delta Airlines to work in its strategy division. For each of the following, illustrate how Delta's supply curve for airline flights will be affected by shifting the accompanying graphs. a. The price of jet fuel falls. b. Innovation of new software allows Delta to more efficiently allocate its aircraft c. Delta signs a new labor contract that increases the wages Delta pays to its employees.

A. 2000 B. 7000 C. 14000 D. 20000 E. 28000 F. 14,000, 28,000 G.

roblem Suppose there are four gas stations in town. The quantity firms are willing to supply each week at various prices is provided in the accompanying table. Determine the quantity supplied for the entire market at each price, then move the points on the graph to create the market supply curve. Price per gallon/ Firm A (gallons per week) / Firm B (gallons per week) / Firm C (gallons per week) / Firm D (gallons per week) $1 / 0 / 1,000 / 1,000 / 0 $2 / 2,000 / 2,000 / 2,000 / 1,000 $3 / 4,000 / 3,000 / 4,000 / 3,000 $4 / 6,000 / 4,000 / 5,000 / 5,000 $5/ 8,000 / 5,000 / 6,000 / 9,000 a. At $1, market supply is gallons. b. At $2, market supply is gallons. c. At $3, market supply is gallons. d. At $4, market supply is gallons. e. At $5, market supply is gallons. f. When the price increases from $3 to $5, the quantity supplied in the market increases from ____ to ____ gallons per week. g. Place the points on the graph to plot the market supply.

It should state that market supply is the sum of the quantities of natural gas that producers are willing and able to sell at every price.

"The market supply for natural gas is the sum of all prices that natural gas producers are willing and able to sell at for every quantity." What is the flaw in this statement? It should state that market supply is the quantity of natural gas that producers are willing and able to sell at one specific price. It should state that market supply is the sum of the quantities of natural gas that producers are willing and able to sell at every price. It should state that market supply is the price of natural gas that one firm is willing and able to provide a specified quantity of its product at. There is no flaw in this statement.

A. marginal B. cost-benefit C. interdependence D. opportunity cost E. marginal F. cost-benefit G. opportunity cost H. interdependence

Akari's boss has offered to pay her for up to 5 hours of overtime today. a. Akari has already been working for 10 hours and is deciding whether to work more hours. A. When Akari considers whether she should work one more hour, she is applying the ______ principle. B. When Akari weighs the money she will earn from working overtime against what she gives up to work the extra hours, she is applying the _____ principle. C. If Akari decides to work the extra hours because she does not think any overtime will be offered in the near future, she is applying the ____ principle. D. If Akari decides to work overtime because her next best alternative is watching TV at home, she is applying the _____ principle. b. Niko, a local UPS manager, is trying to decide whether she should pay for additional trucks and drivers. When Niko considers whether she should pay for one more truck and driver, she is applying the ____ principle. When Niko compares the cost of a new truck and driver to the benefit of increasing the package center's daily deliveries, she is applying the ____ principle. If Niko decides that paying for a new software upgrade is a better alternative than paying for additional trucks and drivers, she is applying the _____ principle. If Niko decides to pay for additional trucks and drivers because she expects the coming season to be extremely busy, she is applying the _____ principle.

Seller: Dodger starts a dog walking business. Angie sells her used guitar on Craigslist. John lists his house for sale. Vanessa is hired as a pilot for American Airlines. Jessica throws a birthday party for her sister. Not a Seller: Brendon asks his friends to help him move. Melanie spends in her application to Arizona State University.

Although most people do not manage a business, nearly everyone acts as a seller in some context of their daily lives. Classify each scenario based on whether the individual acts as a seller or not a seller. Dodger starts a dog walking business. Angie sells her used guitar on Craigslist. Brendon asks his friends to help him move. Melanie spends in her application to Arizona State University. John lists his house for sale. Vanessa is hired as a pilot for American Airlines. Jessica throws a birthday party for her sister.

A. No, more workers will just create more chaos behind the counter as the additional workers still have to wait to fill from the coffee machine. B. diminishing marginal product of labor.

Edith is the owner and manager of a small coffee shop that employs three workers who use the shop's one coffee machine to make and serve coffee to paying customers. Business has begun to pick up; lines are getting longer every day in her shop. On a busy morning, she sees her baristas scrambling to take orders, get cups, fill coffee from the coffee machine, add cream and sugar, and serve customers in a timely manner. She figures if she hires three more baristas she'll be able to sell twice as much coffee. a. Do you think she's likely to be right? Why or why not? No, the current workers just need better training to work more efficiently. Yes, hiring more workers will mean more customers can be served. No, more workers will just create more chaos behind the counter as the additional workers still have to wait to fill from the coffee machine. Yes, more workers will increase the supply and make more coffee available for sale. b. Adding more and more workers does not constantly increase production because of different productivity levels between various laborers. diminishing marginal product of labor. diminishing marginal costs. substitutes in production.

A. consumers view gasoline from different gas stations as perfect substitutes. B. it will lose customers to the cheaper station across the street.

Ilsia is driving home from work. She needs to buy gas and notices an Exxon-Mobil station on one side of the street and a Shell station on the other side of the street. Although run by different companies, the two stations sell gasoline at the same price. a. The most likely reason that the price is the same is that gas stations always make a profit, so they can charge any price they want. drivers need gas and are willing to pay whatever price a gas station charges. government regulation requires both gas stations to charge the same price. consumers view gasoline from different gas stations as perfect substitutes. b. If one station increases its price, it will be fined by the government. it will lose customers to the cheaper station across the street. it will sell more gasoline. it will make a higher profit.

shift to the left

Jerome is working as an IT consultant. His individual labor supply curve is given in the accompanying graph. Jerome decides to enroll in college and will begin taking classes next semester. Make the appropriate change to the graph to show the most likely effect on Jerome's labor supply curve of his decision to attend college. If Jerome's decision to attend college results in a change in supply, shift the supply curve appropriately, but leave the wage line unchanged. If Jerome's decision to attend college results in a change in quantity supplied, adjust the wage line appropriately, but leave the supply curve unchanged.